GreenShift Agrifuels and Global Ethanol, LLC have formed a joint venture to extract about 10 million gallons per year of crude corn oil from the distillers grain co-product of Global Ethanol’s 100 million gallon per year ethanol facility in Lakota, Iowa and 57 million gallon per year ethanol facility in Riga, Michigan, and to convert the extracted corn oil into biodiesel at Global Ethanol’s Lakota facility.

Under the terms of the agreements, GS AgriFuels Corporation and Global Ethanol formed a jointly owned company called GS Global Biodiesel, LLC to build, own and operate the Lakota, Iowa-based biodiesel facility. The GS Global Biodiesel facility will be initially sized for 10 million gallons of biodiesel production per year but will be designed to scale up to 30 million gallons per year in coordination with the onset of production of nearby corn oil extraction systems that are installed by GS AgriFuels’ parent company, GS CleanTech Corporation.

GS CleanTech’s patent-pending corn oil extraction and biodiesel processing technologies convert the fat in the DDG into a high-grade corn oil that can then be converted into biodiesel on close to a 1:1 volumetric basis. This increases the corn to clean fuel conversion efficiency described above to 36%, or about 3.0 gallons of clean fuel per bushel of corn. (Earlier post.)

GS CleanTech executed a development agreement with Global Ethanol and GS Global Biodiesel to build and install corn oil extraction systems at Global Ethanol’s Lakota and Riga ethanol facilities and to design and build the GS Global Biodiesel facility.

GS AgriFuels will raise and provide the financing for the construction of the corn oil extraction systems at Global Ethanol’s Lakota and Riga ethanol facilities, as well as the financing for the construction and operation of the GS Global Biodiesel facility. Global Ethanol will manage and operate the GS Global Biodiesel facility and market all of the biodiesel produced. GS AgriFuels has recently engaged an investment banker to raise the estimated $35 million needed for the project. The parties expect that the first tranche of financing, which will support the construction and installation of two extraction systems in Lakota and one extraction system in Riga, will close in December 2007. The GS Global Biodiesel facility is expected to be commissioned beginning during the fourth quarter of 2008.

Comments

Extracting oil from distiller grains at ethanol plants and produce biodiesel on site could easily become part of a state of the art facility in all future ethanol plants. An advantage of producing biodiesel onsite is that you could use it to fuel all the trains and trucks that deliver corn, distiller grains and ethanol. This would save logistics and cut transportation costs and it would enable the ethanol to be greener. Next step could be to substitute the use of natural gas at the ethanol plant with wind power. Another step is to use cellulose from the corn stalks to produce more ethanol. Further down the road the fertilizer used for corn growing could be synthesized from air and wind power electricity. Furthermore, the corn plant could be genetically engineered to grow faster, to be more drought resistant, to be more suited for ethanol production, and to need less pesticides that may be less harmful. Biofuels could become 100% CO2 neutral if we have the will to do so and make a tax and subsidy system that enables it to happen faster rather than slower.

Nobody has forced the US ethanol industry to use corn. They can freely use whatever they want to but corn is the still the cheapest medium in the US. That will change in the future as the price of corn increases. This will cause other mediums to be used as well notably cellulose from switch grass, wood chips and even refuse. However, I bet that at least 50% of the first 5 billion gallons of cellulosic ethanol produced in the US will come from corn stalks and corn cobs. The infrastructure is there and the logistics is obvious. In 10-15 years from now the situation may be quite different with non-corn plants perhaps making up for more than 50% of all US ethanol production.

Unfortunately, you are correct, most of the ethanol produced in NA in the next five years will probably be from corn and grain produced on good food production land. The price of corn and most grains will multiply as farmer switch to corn. You can already imaging what will happen to the price of meat, cheese, bread, pasta etc. Our stomach will have to compete wil our gas guzzlers....

Sooner or latter we will have to produce agrofuels with agriculture, forest, indutrial and domestic wastes or from non-food plants grown on land unsuited for food production.

Corn-maize and grains are not sustainable nor desirable feeds regardless of what the corn lobbies say.

China has realised that and stoped building more corn-grain ethanol production plants. Our own province has decided that our one and only corn ethanol plant will be the last one. USA with 300 to 1000 corn ethanol plants by 2012 may soon realise that it is NOT the best way to feed our gas guzzlers.

Accellerated electrification of our ground transport vehicles and systems leading to massive liquid fuel consumption reduction may be a much wiser way to go.